Sierra Leone IFMIS Project Overview

1. Government of Sierra Leone Sierra LeoneIFMIS Project Overview Presented by: WINSTON COLE Head, PFM Reform Unit Venue: Nairobi, Kenya 11th November 2004

2. Objective • Overview of the design, procurement process and change strategy for the SL IFMIS Project within the context of an overall PFM reform agenda.

3. Topics Broadly, we will cover the following issues. • Change triggers • Functional design • Procurement process • Implementation approach • Change management • Challenges

4. PFM - Budget Cycle Preparation Execution Reporting Accounting

5. Project Goal • Implementation of a new Integrated Financial Management Information System (IFMIS) in 2005using the newly developed Chart of Accounts (COA) • Other reforms - Government Budgeting & Accounting Act (Revision of Financial Administration Regulation) - Procurement Act - Audit Service Act - Anti-Corruption Act - Local Government Act - Civil Service Reform - Pay & grading review

6. Situation Analysis • Weaknesses identified The current FMAS: • exhibits poor system design and lacks critical functionality, controls, automated bank rec., audit trails and system documentation; • lack of system data checks and controls; • poor response time; • limited ability to generate reports; • weak access security and • is inaccessible to MDAs • supervision of consultants by MOF & EU

7. Functional Design • SOUR- for core/non-core modules • Integral or Integrated • Operational requirements – mandatory (avoids customisation) – desirable • Technical requirements hardware & network (scalability), operating system and relational database (SQL) • Reporting requirements Statutory, Donors, IFAC, IMF-GFSM 2001, management/exception reports – report writing tool

8. How do we achieve the deliverables? • Project management methodology PRINCE2 adopted (Projects INControlled Environment) • QAs deployed in large MDAs and Treasury (by EU Project) to build capacity and assist to prepare monthly Management Accounts and clear backlog Annual Statement of Public Accounts • Team/Resources

9. Team/Resources • PFM Reform Unit – specialist team funded by IDA • Technical support to MOF from donors - project assurance (DfID) - Institutional Strengthening (EU) • MOF-AGD – accounting & internal audit staff • Establishment Secretary’s Office • Auditor General’s Department - AfDB

10. Technology & Standards • Integrated, single treasury account • Based on World Bank Treasury reference model • Benefits: Windows based skills , user friendly, seamless interface with other packages (Bank of S. Leone) • Standards being adopted • IFAC (Cash accounting) • IMF-GFSM 2001 • PRINCE2 project management methodology

11. Corporate Programme Management Minister of Finance • Independent Oversight • The Auditor General IFMIS Organisational Structure Project Steering Committee Project Sponsor World Bank Senior Users Accountant General Budget Director Establishment Secretary Executive Financial Secretary Senior Supplier FreeBalance PFM Reform Unit • Project Assurance • . Independent firm • . Ministry of Health Project Management Head PFM Reform Unit Team Managers IT Specialists FM Specialists Project Support IT Programmers Configuration Librarian

12. Procurement Process • Single Stage – LIB - based on SOUR (tier two vendors) • SBD prepared in stages and shared for comments • Include all modules needed – current and future requirements • Request quote for license/maintenance fee for at least five years (+ % inflation) • Turnkey solution, BUT - local sub-contractors for support (Service Level Agreement) • Evaluation methodology agreed with sponsors - 80% technical & 20% cost - demos against test scripts - end-users evaluation (it is their system)

13. Phasing of acquisition of modules – think BIG, start small Phase 1 - Budget execution and accounting systemto replace present FMAS operating in MoF for whole of government - New HR/Payroll system to replace present FMAS module with input in Ministry of Finance/ Establishment Secretary’s Office during 2005 - Budget preparation system to replace current spreadsheet system for 2006 FY budget

14. Acquisitions cont. • Phase 2 Rollout IFMIS with data input and on-line information access to other central government Ministries – SL Police Force, Health, Educ., Agric., Works & Auditor General’s Department • Phase 3 Roll out to all other MDAs and Local Councils (Fixed Assets, Stores/ Inventory Management)

15. Jun Oct Nov IFMIS Schedule Preparatory Work Internal Review – Mar 03 FMAS ext. review – Nov 03 COA – Nov 03 SOUR – Feb 04 SBD – June 04 Workshops for stakeholders • Milestones Bid submission & Evaluation No objection & Contract Implementation Dec……. 2005 IFMIS “Go-live” in Treasury date will be determined during planning with IFMIS vendor

16. IFMIS Progress Report • Overview of progress against schedule: • Bids issued 24th June, submitted 11th August • Evaluation report submitted 21st September • No objection received 4th October • Contract signed 28th October • FreeBalance implementation team expected to start by 22nd November • In progress: • New COA training (bridge table) • Validation of Payroll: August onwards • Personnel records - DOB, designation, address etc. • Pay Details – grade/scale, allowance/deduction, location, bank details • Advances reconciliation - General Ledger: COA codes mapping Bank Reconciliation Closure of 2004 accounts • 2005-2007 budget prepared using the COA bridge tables • The Project Steering Committee is regularly informed of any project issues needing urgent ad hoc direction

17. Change management • Scale of change – modular, incremental adjustments • Change leadership –change agent • Communication – workshops • Users Participation in evaluation & involvement in implementation • Training – hands-on & overseas • Re-deployment • Release • Motivation & Sanctions

18. Change – stakeholder analysis • Gerald Egan (1994) identifies typical categories of stakeholder: • Your partners, who support your agenda; • Your allies, who will support you, given encouragement; • Your fellow travellers, passive supporters, committed to the agenda, but not to you; • The Fence-sitters, whose allegiances are not clear; • Loose cannons, dangerous because they can vote against agendas in which they have no direct interest; • Your opponents, players who oppose you and your agenda; • Bedfellows, who support the agenda, but may not trust you; • The voiceless, who will be affected, but have little power to promote or oppose, and who lacks advocates.

19. IFMIS Benefits • Improved information – timely, accurateand customised reports • Improved transparency & accountability – availability of reports will make budget officials answerable for the use (mis) of funds – there could be no accountability without transparency (reports) • Better expenditure controls – reduced diversion of funds(requires discipline - collusion) • Savings will be allocated to improve service delivery

20. New COA

21. Challenges • Multiple donor management –timing of funding and procurement procedures • Technical Infrastructure - ICT Strategy - Telecoms (NWAN)- PPI or Govt. owned (Security, reliability/availability) - Power Supply • Change management – selling the vision – reform fatigue • Capacity Building – establishment of an Accounting and ICT cadre – trained staff retention

22. We hope that Sierra Leone will be a model for a successful IFMIS implementation in Africa and walk the globe www.sl-ircbp.org Thank you for your attention